Hi all,
Can anyone tell me how to solve for Interest RATE with 2 (or more) payments in advance. I know I can simply deduct the number of advance payments from the original PV but that does not return the same interest rate as I get on my HP calculator or by using T-Value (a financial amortization program). The issue is that when you have 2 payments in advance, standard amortization tables assume that you would have 1 payment of zero at the end of the cashflows before the residual (FV) becomes due (to make up for the fact that the last payment was paid at the start of the loan). I successfully created formulas that calculate PMT, PV and FV with multiple payments in advance but I keep getting "#NUM!" error messages when I try to solve for RATE. I turned on "Enable Iterative Calculations" under Excel Options/Formulas but none of the formulas I've tried work. If anyone can help, I would really appreciate it.
Thanks in advance.
Thane